Altria Group, Inc. · NYSE:MO
Altria — Q3 2024 Earnings Presentation
31 slides from Altria's earnings presentation, Oct 31, 2024
Slide 1: Altria's Third-Quarter and Nine-Months 2024 Earnings Conference Call
Altria’s Third-Quarter and Nine-Months 2024 Earnings Conference Call October 31, 2024 1 | ALCS | Q3 2024 | 10.31.24 | For Investor Purposes ONLY
Slide 2: Safe Harbor Statement
Safe Harbor Statement Statements, including earnings guidance, in this presentation that are not reported financial results or other historical information are “forward-looking statements” within the meaning of Private Securities Litigation Reform Act of 1995. Such forward-looking statements are bas
Slide 3: 3 | ALCS | Q3 2024 | 10.31.24 | For Investor Purposes ONLY
3 | ALCS | Q3 2024 | 10.31.24 | For Investor Purposes ONLY
Slide 4: Agenda
Agenda Significant progress reducing underage tobacco use; Continued smoke-free products momentum; New initiative designed to modernize our processes; and Our financial and business results. 4 | ALCS | Q3 2024 | 10.31.24 | For Investor Purposes ONLY
Slide 5: Healthy People 2030 Targets Have Been Exceeded
Healthy People 2030 Targets Have Been Exceeded 2024 National Youth Tobacco Survey (NYTS) Healthy People 2030 Targets v. NYTS 2024 (Among Middle & High School Students) Healthy People 2030 NYTS 2024 With the work of many 11.3% stakeholders, we can keep 10.5% tobacco and nicotine products 8.1% from be
Slide 6: Disposable Products are Contributing to Youth Usage
Disposable Products are Contributing to Youth Usage Device Type Used Most Often Any Brands Used (Among Middle & High School Current E-Cigarette Users) (Among Middle & High School Current E-Cigarette Users) 55.6% 36.1% 19.9% 21.8% 15.8% 13.7% 15.6% 7.0% Disposables Pods Open Tank Don’t Know Elf Bar B
Slide 7: NJOY Volume Retention Reflects Consumer Satisfaction
NJOY Volume Retention Reflects Consumer Satisfaction Average Pod Volume Growth ~85% v. Pre-Promotion >50% of volume growth retained Prior to Promotion End of Promotion 13 Weeks Post Promotion Source: POS Scan; Stores Submitting E-Vapor Data all weeks since July 2023 7 | ALCS | Q3 2024 | 10.31.24 | F
Slide 8: NJOY Brand Equity Investments Yielding Positive Results
NJOY Brand Equity Investments Yielding Positive Results NJOY’s Net Promoter Score +20pp 2024 YTD average v. 2023 Source: Awareness and Perception Tracker Q1 to Q3 2024 8 | ALCS | Q3 2024 | 10.31.24 | For Investor Purposes ONLY
Slide 9: NJOY Volume and Share Momentum
NJOY Volume and Share Momentum NJOY Shipment Volume NJOY Consumables Retail Share (in millions) (total U.S.) Consumables Devices +2.8pp 6.2 1.1 ~3x 0.4 3.4 10.4 +15% 9.0 Q3 '23 Q3 '24 Q3 '23 Q3 '24 Source: Circana Projected Total U.S. MOC week ending 9/29/2024. 9 | ALCS | Q3 2024 | 10.31.24 | For In
Slide 10: Illicit Products Driving E-Vapor Category Growth
Illicit Products Driving E-Vapor Category Growth Adult Vapers 21+ - Past 30-Day Usage Vapers by Cigarette Usage Vapers by Form (twelve months ended, in millions) (twelve months ended, in millions) Exclusive Vapers Vapers Who Also Smoke Cigarettes Disposable All Other Forms 19.0 19.0 16.5 16.5 13.4 1
Slide 11: Positive Enforcement Actions Against Illicit E-Vapor
Positive Enforcement Actions Against Illicit E-Vapor This summer, the U.S. Food and Drug Administration (FDA) with U.S. Customs and Border Protection, seized more than 50,000 unauthorized e-vapor products from China. In August, the FDA issued a proposed rule requiring all imported e-vapor produc
Slide 12: NJOY Litigation
NJOY Litigation Last week, the Administrative Law Judge in NJOY’s case against JUUL extended the deadline for her initial determination to December 6, 2024. We have developed strategies that we believe would allow ACE to remain on the market or limit sales disruption in the event of certain adve
Slide 13: U.S. Oral Tobacco Category and on! Shipment Volume
U.S. Oral Tobacco Category and on! Shipment Volume Oral Tobacco Industry Volume Growth on! Shipment Volume (estimates, six months ended) (cans in millions) +46.0% 41.9 7.5% 5.0% 28.7 0.0% 9/30/2022 9/30/2023 9/30/2024 Q3 '23 Q3 '24 Source: ALCS CMII estimates. Rounded to the nearest 0.5%. Oral tobac
Slide 14: on! Repeat Purchasers Continue to Grow
on! Repeat Purchasers Continue to Grow on! Repeat Purchasers +40% ~700K ~500K Q3 '23 Q3 '24 Source: ALCS CMII estimates based on Circana Projected Total U.S. MOC data week ending 9/29/2024 and POS scan data week ending 9/28/2024. 14 | ALCS | Q3 2024 | 10.31.24 | For Investor Purposes ONLY
Slide 15: Consistent on! Share Momentum
Consistent on! Share Momentum on! Share of Oral Tobacco Category (total U.S.) +2.0pp 8.9% 6.9% Q3 '23 Q3 '24 Source: ALCS CMII estimates based on Circana Projected Total U.S. MOC data week ending 9/29/2024. 15 | ALCS | Q3 2024 | 10.31.24 | For Investor Purposes ONLY
Slide 16: FDA Must Clarify its Enforcement Posture on Synthetic Products
FDA Must Clarify its Enforcement Posture on Synthetic Products According to federal law, it is illegal to sell or distribute a synthetic nicotine product in the United States that has not received a market granted order from the FDA by July 2022. To date, the FDA has not authorized any synthetic
Slide 17: Optimize & Accelerate Initiative
Optimize & Accelerate Initiative Process Streamlining & Artificial Intelligence & Centralizing Outsourcing Standardizing Automation We expect the initial phases of the initiative will deliver at least $600 million in cumulative cost savings over the next five years, which we plan to reinvest in our
Slide 18: 18 | ALCS | Q3 2024 | 10.31.24 | For Investor Purposes ONLY
18 | ALCS | Q3 2024 | 10.31.24 | For Investor Purposes ONLY
Slide 19: Adjusted Diluted EPS and Financial Outlook
Adjusted Diluted Earnings Per Share (EPS)* and Financial Outlook Third Quarter First Nine Months +7.8% +1.6% $3.84 $3.78 $1.38 $1.28 Q3 '23 Q3 '24 Nine Months Ended Nine Months Ended Sept. 30, 2023 Sept. 30, 2024 We reaffirm our full-year 2024 guidance range to deliver adjusted diluted EPS in a rang
Slide 20: Smokeable Products Segment
Smokeable Products Segment Adjusted Operating Companies Income* (OCI) Third Quarter First Nine Months ($ in millions) ($ in millions) +7.1% +0.9% $8,142 $8,213 $2,935 $2,741 (0.4) Q3 '23 Q3 '24 Nine Months Ended Nine Months Ended Sept. 30, 2023 Sept. 30, 2024 *For reconciliations of non-GAAP to GAAP
Slide 21: Smokeable Products Segment
Smokeable Products Segment Adjusted OCI Margins* Third Quarter First Nine Months +3.5pp +1.6pp 63.1% 61.7% 59.6% 60.1% (0.4) Q3 '23 Q3 '24 Nine Months Ended Nine Months Ended Sept. 30, 2023 Sept. 30, 2024 *For reconciliations of non-GAAP to GAAP measures visit altria.com. 21 | ALCS | Q3 2024 | 10.31
Slide 22: Adjusted Cigarette Decline Rates
Adjusted Cigarette Decline Rates Smokeable Segment Total Industry Q3 '23 Q3 '24 Q3 '23 Q3 '24 (10.0)% (11.5)% (8.0)% (9.0)% 9M: (11.0)% 9M: (9.0)% Source: ALCS CMII estimates – rounded to nearest 0.5%. Note: Estimates are subject to revision due to wholesaler resubmission of inventory data. 22 | ALC
Slide 23: Discount Retail Share
Discount Retail Share Branded Discount (Major Manufacturers) Deep Discount (All Other) 29.3 29.8 28.7 29.1 28.3 28.3 28.3 15.3 15.3 15.4 15.5 15.4 15.3 15.3 13.4 13.8 14.0 14.4 12.8 12.9 13.0 Q1 '23 Q2 '23 Q3 '23 Q4 '23 Q1 '24 Q2 '24 Q3 '24 Source: Circana InfoScan Cigarette 2024-Blended, week endin
Slide 24: Marlboro Retail Share and Share of Premium
Marlboro Retail Share and Share of Premium Marlboro Retail Share Marlboro Share of Premium (0.6pp) +0.3pp 59.0% 59.3% 42.3% 41.7% Q3 '23 Q3 '24 Q3 '23 Q3 '24 Source: Circana InfoScan Cigarette 2024-Blended, week ending 9/29/2024. 24 | ALCS | Q3 2024 | 10.31.24 | For Investor Purposes ONLY
Slide 25: John Middleton Cigars
John Middleton Cigars Reported Shipment Volume (1.6)% 451 444 Q3 '23 Q3 '24 25 | ALCS | Q3 2024 | 10.31.24 | For Investor Purposes ONLY
Slide 26: Oral Tobacco Products Segment
Oral Tobacco Products Segment Adjusted OCI* and Adjusted OCI Margins* Adjusted OCI Adjusted OCI Margins ($ in millions) +2.0% (2.5pp) $455 $464 69.3% 66.8% Q3 '23 Q3 '24 Q3 '23 Q3 '24 *For reconciliations of non-GAAP to GAAP measures visit altria.com. 26 | ALCS | Q3 2024 | 10.31.24 | For Investor Pu
Slide 27: Total Oral Volume Increased Driven by on! Momentum
Total Oral Volume Increased Driven by on! Momentum Oral Tobacco Shipment Volume (in millions) MST + Snus on! +1.2% 194.8 197.1 28.7 41.9 166.1 155.2 Q3 '23 Q3 '24 27 | ALCS | Q3 2024 | 10.31.24 | For Investor Purposes ONLY
Slide 28: ABI Investment
ABI Investment All third-party trademarks remain the property of their respective owners. 28 | ALCS | Q3 2024 | 10.31.24 | For Investor Purposes ONLY
Slide 29: JUUL-Related Tax Losses
JUUL-Related Tax Losses In October, we reached an agreement with the IRS regarding the tax treatment of the ordinary losses related to our former investment in JUUL. We have claimed $4 billion of ordinary losses and $4.1 billion of capital losses on our 2023 tax return. Of the $4.1 billion of ca
Slide 30: Committed to Long-Term Value for Our Investors
Committed to Long-Term Value for Our Investors • Paid $1.7 billion in dividends in the third-quarter. Dividends • Raised our dividend by 4.1% in August, our 59th increase in the past 55 years. • Repurchased $680 million of shares during the third-quarter. Share Repurchase • Approximately $310 millio
Slide 31: 31 ALCS | Q3 2024 | 10.31.24 | For Investor Purposes ONLY
31 ALCS | Q3 2024 | 10.31.24 | For Investor Purposes ONLY All new products subject to FDA authorization. Third-party trademarks remain the property of their respective owners.